Peculiar signs line the road into the Grandview neighborhood in Hampton. They read “No Wake Zone” — as in, the kind usually meant for boats out on the water.
Resident Jane Elizabeth said that’s because of frequent flooding during storms and high tides.
“People think, ‘Oh, somebody just put that up as a joke.’ No, it's because of cars going through the water and throwing wake,” she said. “It is definitely not a joke."
Elizabeth and her husband have lived in Grandview for almost 20 years. The neighborhood sits at the eastern tip of Hampton and is crisscrossed by creeks and rivers.
That makes it a beautiful place to live, she said. But it’s also particularly exposed to extreme winds and waves.
A few years ago, Elizabeth and her husband got a letter from their home insurance company, Narragansett Bay, notifying them that their policy would not be renewed.
The reason stated: “The company is reducing the total amount of property insured in coastal states.”
Elizabeth said she’d heard of this happening in other, high-risk areas of the country, such as Florida. “But I hadn't really realized that would happen to us.”
Elizabeth and her husband eventually found a policy through a different company. But the experience left them unsettled.
“It's a decision that I think everyone in the coastal area has to wrestle with. You either accept it, or you think, you know, maybe it's time for me to get out.”
The home insurance industry is in constant flux. Where insurers decide to cover and how much they charge changes every year and is highly local.
But the national trend is clear: The threat of more unpredictable, intense – and expensive – storms from climate change is driving up premiums and disrupting markets.
That includes Hampton Roads. But still, experts say Virginia is well behind the volatility in regions such as hurricane-prone Florida and wildfire-exposed California.
People can almost always find insurance – they might just have to shop around, or pay a lot more to get it.
Dropped policies and insurer decisions
After the experience with her insurance company, Elizabeth polled neighbors and heard from more than a dozen who had policies canceled or seen rates skyrocket.
Between 2018 and 2023, nonrenewals of home insurance jumped in many areas of Hampton Roads, including Norfolk, Hampton, Newport News and Virginia Beach, according to the most recent data released by Congress.
Accomack County on the Eastern Shore saw the greatest increase — 400% — with one in 25 insurance policies dropped.
Rita Chandler was insured with State Farm for more than 25 years. But that changed a few years ago, when she moved from Norfolk to Accomack.
“I called them to switch my policy over. They said, ‘Well, we're sorry, but we don't insure on the Eastern Shore of Virginia,’” Chandler said. “And I said, ‘Oh, why is that?’ She said, ‘Because of the high wind.’”
Chandler was surprised because her previous home in Ocean View was also subject to high winds.
She and her husband “had to hunt around” for other options. Eventually they found a policy through a company based in Pennsylvania, which their insurance agent told them covers many homes in the area.
State Farm declined to discuss specifics about the Eastern Shore, but told WHRO in a statement that the company “is in the business of selling insurance, and we want to provide coverage where we can do so responsibly.”
“At the same time, we must carefully manage our exposure to loss so we can remain financially strong and continue keeping our promises to customers over the long term,” the company stated. “Coastal properties can have different risk considerations, such as wind, hurricanes and storm-related exposure.”
The company said it continues to insure in coastal communities but evaluates each request for coverage based on risk characteristics of the individual property.
Ernie Garateix is CEO of Heritage Insurance, which includes Narragansett Bay – the company that dropped Elizabeth in Hampton.
He said the industry’s attention on storm risk picked up after Hurricane Andrew in 1992 left many companies with huge losses. Companies have developed sophisticated ways of predicting risk.
“Basically those models take the past 100 years of storms, place them on a map, and what we're trying to watch is, when there's an event, what are our exposures going to be, and making sure that we're kind of managing that,” Garateix said.
Carriers will temporarily shut down in some areas, then write policies again as they balance them in other, less exposed places, he said.
It's all down to the individual address level.
Another big factor is reinsurance, or insurance for insurance companies. That market is cyclical, Garateix said.
When it’s tight, “you either have to buy less reinsurance, or you have to kind of reduce exposures in some of the coastal areas.”
This summer, the National Association of Insurance Commissioners’ Center for Insurance Policy and Research released a nationwide assessment of state-level data. It found that overall, the market remains operationally strong.
But “at the same time, clear signs of stress are evident,” authors wrote, with the market adjusting to rising weather-related losses, higher claims costs and inflation.
Even though many home insurance companies are still operating, more than half have reduced the number of policies they wrote between 2018 and 2024, according to the report.
“That suggests companies are adjusting their exposure and reassessing where and how they write coverage.”
In some places, home insurance “is becoming more expensive and harder to keep.”
Adjusted for inflation, average premiums nationwide have increased by 18 to 43%, and companies are choosing not to renew policies more frequently, the report says.
Analysts noted that these trends should not be treated “as a single national problem with a single national answer.”
Markets are local, they noted, and insurance is regulated at the state level.
The “hurricane tax” and rising costs
Back in 2013, Norfolk-based nonprofit Wetlands Watch analyzed the potential impacts of climate change on insurance, hoping to learn how homeowners could prepare.
Skip Stiles, then-director of Wetlands Watch, said the group gained some interesting insights, such as how Hurricane Katrina had transformed the industry.
After the 2005 storm destroyed houses along the Gulf Coast, disputes arose between insurance companies and the National Flood Insurance Program over who was responsible for paying the damages: Which destroyed the home first, floods or wind?
A flurry of expensive lawsuits ensued, and companies “began to pull out of some areas and basically change the way they were doing business,” Stiles said.
But at the time of its study, Wetlands Watch didn’t find enough evidence of a “climate signal” in the industry, he said.
Then a few years ago, Stiles noticed changes to the insurance bill for his Ghent home.
His company, the Mutual Assurance Society of Virginia, had imposed a 25% increase to his policy’s base assessment, tied to “coastal exposure.”
“Over the past four years, the Society has seen a sharp rise in both the frequency and severity of losses resulting from severe weather events,” the company wrote to Stiles. “This has resulted in a net operating loss for the Society during each of those years, and it is more than likely that this pattern will continue into the foreseeable future.”
The company also included a “tropical cyclone deductible” of nearly $12,000.
Basically, his policy was costing more, and if he was hit by a major storm, the coverage was also less.
“I said, ‘Aha. They finally found me,’” Stiles said. “All of these larger changes have finally found their way to my household.”
The Mutual Assurance Society of Virginia did not respond to a request for comment.
These charges, sometimes called “hurricane taxes,” vary by company and policy, often listed as wind, hail or named storm deductibles. They can be a fixed amount or a percentage of the home’s coverage.
Storm or wind deductibles are pretty much a given these days in Hampton Roads, said Eddie Redfearn, vice president of Nusbaum Insurance Agency in Norfolk. He often has to explain the concept to people who move here from regions where it’s less common.
“To sit down and tell someone, if the wind blows, you're going to have a $40,000 deductible, it can be frightening.”
But the deductibles have rarely been tested here, he said.
Virginia remains a favorable place for insurance companies for several reasons, Redfearn said. State regulations encourage competition and make it easy for the companies to do business.
Plus, the state has managed to avoid many direct hurricane hits in recent years.
Some states, including North Carolina, use a “wind pool,” in which consumers have to buy wind coverage separately through the state, with participating insurers required to share the risk.
Redfearn said companies don’t like that system, so “it’s a good thing we do not have one.”
Insurers constantly reevaluate coverage, he said. Some won’t write within a mile of shoreline.
But for now, Virginia’s in a relatively good spot.
“We've generally not had an all-out retreat from the insurance companies in our area, even with the coast out there, looming.”
He recommends looking at your policy closely to understand what is covered – before you might need to file a claim.
For example, remember that home insurance does not typically cover flood damage.
